According to reports, with mounting losses and bulging dues to power suppliers, the cash-strapped Tamil Nadu Electricity Board(TNEB), which has now been restructured into two entities, hopes to raise about Rs 11,000 crore through loans and bonds to pay the debtors and support its activities. This is one of the series of measures it is embarking on to improve its financial conditions.
While it is awaiting central government approval for its financial restructuring plan (FRP), the board has been making its own efforts to generate funds for supporting some of its activities as also to repay the power suppliers.
“The state government has given guarantee for us to raise about Rs 5,000 crore as loans from financial institutions. Besides, we will also get Rs 6,000 crore of funds, raised through bonds by the Tamil Nadu Power Finance & Infrastructure Development Corporation. Thus, overall we expect to get about Rs 11,000 crore,” Rajeev Ranjan, chairman and managing director of Tamil Nadu Generation and Distribution Corporation and chairman of Tamil Nadu Transmission Corporation said.
The board has already submitted a proposal for tariff hike as part of its FRP and expects the tariff hike to take place during next financial year. It hopes to get about Rs 9,000 crore through tariff revision along with some government support. “With all these initiatives, we expect the situation to improve drastically,” he added.
Besides, the organisation also expects the disbursal of Rs 3,000 crore from Japan International Cooperation Agency to commence from next financial year. This fund has been tied up mainly for augmenting the evacuation and transmission infrastructure in the renewable energy corridors in the state. The state government also provided Rs 2,600 crore as share capital support and Rs 955 crore as loan to the board during this year.
The board has planned to spend about Rs 10,000 crore in strengthening the transmission and distribution infrastructure over the next two years. It had sought about Rs 4160 crore from clean energy fund, which is being administered by the union finance ministry. Central Electricity Authority has recommended an amount of Rs 2,172 crore under phase I of the proposal, which is awaiting clearances from other committees.
State electricity board has accumulated losses of Rs 40,000 crore and payment dues of Rs 10,500 crore to vendors and suppliers.